TIDMMATD
RNS Number : 6423E
Petro Matad Limited
13 February 2018
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY
PETRO MATAD LIMITED TO CONSTITUTE INSIDE INFORMATION AS STIPULATED
UNDER THE MARKET ABUSE REGULATION (EU) NO. 596/2014 ("MAR"). ON THE
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION
SERVICE ("RIS"), THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN
THE PUBLIC DOMAIN.
13 February 2018
Petro Matad Limited
("Petro Matad" or the "Company")
Operational Update
Petro Matad, the AIM quoted Mongolian oil explorer, is pleased
to provide an operational update for its planned 2018 work
programme:
Highlights
-- Completed a US$16.8 million fundraising to execute a four
well drilling programme on the Company's acreage in 2018, with the
first well, Wild Horse-1, planned to spud in Q2 2018 using the
previously contracted and fully certified Sinopec Rig 4518
-- Making progress to source a rig to drill the two well programme in Block XX in H2 2018
-- Processing of the 2D and 3D seismic surveys acquired in
Blocks IV and V respectively is ongoing. Data quality is very good
and the work is progressing on schedule with final processed
products expected by the end of Q1 2018
Blocks IV and V
The Company's planned two well, back to back, exploration
drilling programme will commence with the spudding of a well on the
Wild Horse prospect in Block IV in the Baatsagaan Basin. The Wild
Horse prospect is a prominent structural high well positioned to
receive oil charge from two of the largest and deepest potential
source kitchen areas in the Company's western Mongolian acreage.
The planned total depth ("TD") of the well is 1,850 metres,
penetrating a significant thickness of stratigraphy within closure.
The Company's mid-case estimate of prospective resources in the
Wild Horse structure is 290MMbo recoverable, with significant
upside potential (c.750MMbo recoverable) identified in 13 further
prospects and leads in the same basin that would be partially
de-risked by success in Wild Horse-1. The well is expected to take
approximately 30-45 days to drill and log at a cost of
approximately US$4 million.
Following Wild Horse-1, the rig will move to Block V and drill
the Falcon prospect in the Tugrug Basin. The primary objective of
the recently acquired 3D survey was to accurately delineate the
cluster of prospects in the Falcon area to ensure the well is
optimally located to penetrate the primary reservoir targets.
Falcon-1 is planned to be drilled to a TD of circa 3,000 metres and
it is expected that the well will take approximately 60 days to
drill and log at a cost of approximately US$7 million. The
Company's mid-case prospective resource estimate for the Falcon
prospect is 100MMbo recoverable with 180MMbo of follow up potential
identified nearby.
The Falcon area has been high graded for early drilling as there
is very good evidence, including live oil staining in reservoirs
penetrated in a nearby deep core hole, that the petroleum system is
working in the Tugrug Basin. As a result of this high grading,
Falcon has moved ahead of the Snow Leopard prospect in the
Company's preferred drilling order. The Snow Leopard prospect
remains an attractive target for exploration in the Taats Basin of
Block V and the Company looks forward to drilling the feature with
the results from the 2018 drilling campaign in hand.
Efforts are now focused on securing the necessary environmental,
chemical and land use permits that are required prior to the
commencement of drilling. The Company is targeting the spud of the
Wild Horse-1 well as early in the Mongolian drilling season
(mid-April to mid-November) as possible to provide sufficient time
to fully complete operations and evaluate the results of the 2018
drilling programme. The exact timing of the first well spud is
dependent upon securing the necessary permits. As a result of the
ongoing engagement with the Ministry of Mining, the Ministry of
Environment and the industry regulator MRPAM, the Company expects
that Wild Horse-1 will spud in Q2 2018.
Sinopec Rig 4518, contracted for the 2018 drilling campaign in
Blocks IV and V, has been stored for the winter in a Sinopec
facility in southern Mongolia. Mobilisation will commence once the
Company has secured the necessary drilling permits from the
Mongolian authorities.
Block XX
The Company is in active discussions with drilling contractors
operating in Mongolia to secure a rig for its 2018 work programme
in Block XX, and the Company is confident that a suitable rig will
be contracted to enable drilling in 2018, as planned. The Company's
current intention is to spud the Gazelle prospect in Q3 2018, with
a second well to follow on immediately afterwards at a location
still to be determined, based on ongoing technical work.
The prospectivity in the northern part of Block XX, neighbouring
the producing fields in Block XIX, offers a good chance of success
with the potential to put commercial discoveries on-stream quickly,
utilising spare capacity in nearby facilities. The recently
approved two-year extension to the exploration term of Block XX
allows the Company sufficient time to explore these near field
opportunities, with the 2018 two well programme being the first
step in that campaign.
Mike Buck, CEO of Petro Matad said:
"This is a very exciting time for Petro Matad as we head into
one of the highest impact drilling campaigns any independent has
undertaken in Mongolia. We are now deep into the preparation phase
to spud our first well at Wild Horse-1 in Q2 2018. We are pleased
to see that rig availability for our planned drilling in Block XX
looks good. I look forward to updating the market on our progress
as our preparations for this highly active year continue".
For more information, please contact:
Petro Matad Limited
+97 670 141 099 / +97
Mike Buck, CEO 675 751 099
Stockdale Securities Limited (Nominated Adviser
and Broker)
Richard Johnson
Andy Crossley
El Hanan Lee +44 (0) 20 7601 6100
FTI Consulting (Communications Advisory Firm)
Edward Westropp +44 (0)20 3727 1521
All Reserves and Resources definitions and estimates shown in
this report are based on the 2007 SPE/AAPG/WPC/SPEE Petroleum
Resource Management System ("PRMS").
Technical information in this news release has been reviewed by
the Company's Senior Petroleum Geology Advisor, Mr. Andrew
Barnwell, who is the Petroleum Geologist & Director at Barnwell
Parker Geoscience Ltd. He has 30 years of experience in oil and gas
exploration and holds a M.Sc./DIC in Petroleum Geology from
Imperial College, London. Mr Barnwell is a member of the Petroleum
Exploration Society Great Britain.
Glossary
MMbo million barrels of oil
Prospective estimated volumes associated with
Resources undiscovered accumulations. These
represent quantities of petroleum
which are estimated, as of a given
date, to be potentially recoverable
from oil and gas deposits identified
on the basis of indirect evidence
but which have not yet been drilled
TD total depth
About Petro Matad
Petro Matad is the parent company of a group focussed on oil
exploration, as well as future development and production in
Mongolia. At the current time, Petro Matad holds the sole
operatorship of three production sharing contracts with the
Government of Mongolia. Block XX has an area of 10,340 km(2) in the
far eastern part of the country, and Blocks IV and V have an area
of 28,900 km2 and 21,100 km2, respectively, in the southwest part
of the country.
Petro Matad Limited is incorporated in the Isle of Man under
company number 001483V. Its registered office is at 6(th) Floor,
Victory House, Douglas, Isle of Man, IM1 1EQ.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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